For example, you can have someone sign a non-compete agreement in California but it does not mean its legal.

From what I have seen, only players here in US that go that route are the large funds like blackrock etc.

As a first time investor, I'm thinking to replicate those existing houses (with little bit of my touch) but wanted to ask what would be the pros and cons in terms of competing with existing STR's in the community?

My clients that do this actually do quite well and by quite well i mean 250k NET a year or better. .. far better than your average wholesaler. that is competing with a hundred other wanna be wholesalers for those same beat up inner city homes :)

The easiest way to get around any of this is to hire a competent property management firm to handle everything. 

Big players like FedEx and St.

Fortunately for us, our offer was accepted immediately.This was at a time when we were competing against buyers who were scarfing up Cambridge property with cash offers well above asking price.

BTW,  I would encourage you to open your criteria to distressed properties, tax liens, probate, divorce, etc..if you don't want to compete in the competitive market.   

It's puzzling that this market appears to support only a single dominant player. 

Now if you mail to those 100 -200 leads, 4 different direct mail pieces and get no response....thats a problem.Success rate I would say 2 deals per 600-700 mailings.I know Atlanta has a lot of counties but you better be ready to compete.